Managing a global legal department: Opportunities and challenges

This is the first in a four-part series in which Oracle Associate General Counsel Suchitra Narayen, QuisLex CEO Ram Vasudevan and consultant Rees Morrison will discuss the opportunities and challenges facing a global legal department.

The global business arena places unique demands on corporate counsel. Collaborating across multiple time zones can be difficult and inefficient, and supporting business units in different countries—not to mention dealing with suppliers, customers and governments worldwide—can present a host of issues. At the same time, globalization provides opportunities for corporate legal departments because the diversity of knowledge, experience and perspective essential to provide effective legal support in today’s global economy is available within the department. In addition, alternative geographically-distributed legal resources have become increasingly sophisticated, and are available to assist with significant process and technological enhancements. Companies that consciously consider the implications of a global legal practice, successfully manage the potential challenges and leverage the corresponding opportunities place themselves at a distinct competitive advantage.

The traditional view is that having employees sitting in multiple countries creates obstacles for managers in a global legal department. As a practical matter, although web-conferencing and other technologies are available to alleviate some of the issues, otherwise straightforward projects that require collaboration from employees in different locations can be impacted by having to work across different time zones, communicating primarily via email or telephone calls, and lack of familiarity with colleagues.

As most managers of large, multinational legal departments can attest, however, running a global legal department involves more than simply coordinating employees in different time zones. While doing so certainly creates logistical challenges, the defining characteristic of a global legal department is the diversity not only of the individuals that make up the organization, but also of the internal clients, external suppliers, customers, partners and governments that are likewise distributed across a variety of countries and locations. Finally, for every jurisdiction in which the company operates, the global legal department must take into account laws, regulatory requirements and judicial mechanisms that can vary widely and have an enormous impact on the approach a legal department takes and the methods by which it services its clients.

In-house counsel located in the U.S. may be asked to explain the business operational implications of legal requirements based on an English translation of a German document governed by Swiss law, or to decide if there is a problem with a bilingual document presented for signature where the Chinese or Ukrainian column seems to have three times as much content as the English “translation.” Deal schedules can be impacted by the limited availability of clients, customers and suppliers during the Las Posadas/Novenas Navide celebrations (starting Dec. 16 in Latin America), followed by the Russian Christmas/New Year holidays (occurring in early January based on the Georgian calendar) and then Chinese New Year (which lasts for two weeks and typically starts between late January and mid-February).

This diversity should be viewed as an opportunity, not as a challenge to a manager’s ability to effectively run the legal department. By nature, a global legal department’s employees come from different ethnic, cultural and linguistic backgrounds. Even if the communication is primarily in English, the vocabulary used, and its meaning, may differ. This can lead to interesting (at least to lawyers) debates about the use of “warranty” versus. “guaranty” and the exact scope of a license to “use” a particular technology. Having this understanding within the legal department can help avoid potential communication issues.

One important consideration in the context of legal departments specifically is the fact that attorneys may have been educated and trained in different legal systems (e.g., common law versus civil law), which can substantially impact their understanding of legal concepts, approach to legal issues and style of drafting. This impact is, unfortunately, often understated or even ignored by managers of global legal departments. As attorneys, we take for granted that our colleagues will “think like attorneys,” but may fail to realize that “thinking like an attorney” can mean different things in different locations. Recognizing this difference can help managers not only better understand their employees’ approach to legal issues, but also better leverage the diverse legal knowledge and experience within the department to more effectively address legal issues that span multiple jurisdictions.

The global economy is here to stay. Even the legal departments of small companies may be “global” in that their suppliers and/or customers are distributed across other countries. Successful legal departments will not only accept that reality, but also view it as an opportunity to leverage the skills and knowledge of its in-house counsel, wherever located. In the next installment of this series, we will address how collaboration within a global legal department can help address the challenges discussed above.

Questions about this article may be addressed to Mr. Vasudevan at ram@quislex.com.